Selloff coming out of the united states. This mixill throw into as well what has come out and the last hour from carl icahn. Interesting to see him backing trump. Inis a guy well followed terms of his views around the markets and have Central Banks and governments influence those markets. This is what he had to say in the video he released about the low rate environment. Why should they raise rates . It is almost a rhetorical question. There are so many reasons. Low rates are almost by definition building bubbles. Real estate bubbles. Guy one of the stories riling the asia markets right now is glencore. I want to show you one chart. I want to show you this one here. It highlights what is happening with glencores debt and equity. The market capitalization is in yellow. The total debt is in green. You have yellow above green, yellow above green for the last four years. The problem is we are now down here. This is the current equity valuation of glencore. This is the debt story. That is something that ig will have to think a lot about. We will be talking a lot about glazing berg throughout the glazenburg throughout the program. Reporter not such a great morning for you to wake up to. We essentially follow the leader. That big fall coming in glencore shares in london and new york. As we mentioned we are seeing significant falling in glencore shares listed here in hong kong. They are not listed on the hang , but it is certainly having a big play in the region. None of those 50 stocks listed are in the black. China coming back after the lunch break, down by 2 . You can see them coming through from the likes of steel. The main commodity market and the region, australias asf 200. Again is at the low there has been a bit of a flat. We are seeing it strengthen against the greenback bloomberg. Com it is at greenback. It is at 0. 3 on the back of that. A lot of that coming through on the fear of the Global Equity rout and a lot of that falling through in the prices. Juliet on what has been happening in asia. She mentioned what is happening with the mining stocks reverberating around the world. And all of the stocks really under pressure right now. Lets go to david in melbourne. Give us more detail about what has been happening overnight. Sayingou and juliet were , we have seen that selloff from london overnight continue through the trading day. The worlds biggest miner has fallen the most in seven years. Trading still continues for another hour or so. Touched the lowest since 2009. Group,fort askew metals group, that metals has followed to the lowest in three years. Since 2012. Lowest across the board we have seen the Mining Companies suffering and trading. Guy any sense that this is a bottoming phase . Reflected in the stocks is coming to a conclusion or that is this the end of the beginning rather than the beginning of the end . That is the key question. There is a bit of a diversions of views. Companies see the situation is mainly volatility in the short term. Story thatat as a still has plenty of legs in it. Is thatrnative view what we are seeing is weakening demand in china colliding with oversupply. That is something that cannot be fixed without a swift reduction in supply and that could take some time. There is a bit of a debate about whether this will last for the shortterm or whether we are in for a longterm scenario. Guy thank you very much indeed. The stock fell by a record lets bring inn Ryan Chilcote to talk about the sense of the scale of the selloff that we are seeing. The question you want to ask yourself is will we see more of a selloff today. Are down by 29. 5 . The biggest single day decline since the company went public in 2011. More than five times the daily average. How all the about equity value could be wiped out if Commodity Prices like copper stay where they are. 10 . America was down the shares are extraordinary. Down 77 yesterday and since the beginning of the year. Down 87 since the ipo. How exit upset would you be if you bought glencore shares as part of the ipo . It is very tightly held stock. One of the things that we have been talking a lot about is the debt versus the equity. We talked about current equity worth very little and current debt worth an awful lot and that is taking the credit story. Ryan absolutely. This is pretty geeky but interesting. You see what we call a debt market distortion. It indicates that a company is in distress. That is a graph for glencore. You see that it costs more to insure debt that is coming up to the end of the year than it does on the 10year debt. Oftennt see that very and that means the company is in distress. Is, if you look at the bond yesterday and the cds, this is a company being treated as if it were junked by traders. Yesterday we looked across the space for investmentgrade companies. Issued 18 billion dollars of yen versus 18. 9 billion yesterday. We know of two companies that halted their newest sale, that were supposed to happen yesterday that didnt. If you look at the junkbond market and glencore is not junk, yet at least. You see yields writing above rising above 8 for the first time in three years. You have what many are calling a perfect storm in the market. This concern about Commodity Prices. Slumping demand in china. The threat of increased Interest Rates. And glencore serving as the spark. Guy the credit markets are spooked not just by glencore but vw as well. The vw story plus the glencore story are two of the ryan on the equity markets, if you look in volumes. Five to six times the normal range of volume for glencore was put in much the same as what we saw last week. Guy Ryan Chilcote on the glencore story. Just a kind of caveat, peter senior independent nonexecutive director at glencore. We need to make that very clear. We will be digging further into the glencore story and the mining story. Has a performance rating on the stock loss we will be looking at the biggest losers and the dwindling number of billionaires. At 8 00 a. M. We will be talking ec ceoest tech invest mark elliott. Theng up on countdown, parties remain divided on how to end the syrian conflict. After the break. Guy good morning, these are the stories that you need to know. Toward a nearled threeyear low. The msci index added to its biggest quarterly low since the financial crisis. Every Major Business began retreating today. Asias biggest Commodity Companies have been hit hard. I collapse in glencores stock highlights the threat of sliding row material prices. In india, the central bank has a right decision coming up at 6 30. The r. B. I. Is expected to cut the benchmark rate for a fourth time. A majority of economists say that. Lets move on. Back to the u. K. The second day of the labour party conference. Jeremy corbyn is due to give his address to the new delegates. We go now live to brighten who has a guest who will give us insight into what insiders hope to say. We are going to hear from Jeremy Corbyn, the new leader of the labour party. So far, this conference has been an exercise in avoiding conflict. Many of the topics being discussed here are not ones that are brought the differences of the party to the floor. Businessesout what may be of earning so far. John joins me here. Do you recognize that picture . That this is a conference where the leadership has spent their time mending bridges . I think it has been very wellmanaged in the sense of the message that has been given. It has been calm and structured. Theyre looking at the positives. The shadow chancellor and the leader made it clear they want to work with businesses and review the economy. He said we should go back and look at the First Principles for how an economy should work. It is a good idea. Anna do you feel more comfortable today than two weeks ago about the ability of business to work with a labour leadership of this type. We are talking about a potential labor leadership if that worked to come to pass. They would not be running the entire Parliament Even if they did win the next election. But certainly we need and want to work to develop labour party policy. One of the problems with labor in the past has been that they set out objectives that may be reasonable but dont understand how the economy or business works. Also, the town has been a problem in the past and it is still a thing that they need to watch out for now. To engage in business, setting the right tone is important. Careful top a very stretch that point over the last couple days. As with looked toward the political spectrum and the policies in power right now, the labour party is very distracted by what is going on. And divisions. This seems to offer conservatives an opportunity to implement policies they previously only dreamed of. As set something the Business World is afraid of . Guest i think that the conservative party are in power. They had a complete victory and therefore have a free hand to do as they wish. There was always the possibility of backbench rebellion. I think the government is generally on the right track in terms of deficit reduction and debt reduction. Clearly the u. K. Is vulnerable until we have another world recession. That is not entirely impossible in the next decade. It is very important that they continue to do this. The big debate with the labour party is, do you need to cut public spending or can you do it by other means . There is no question on either side that the deficit and the debt have to be reduced. Anna it depends how you define the deficit. Savings talking about for a surplus but only after you strip out the infrastructure. This is a question we have asked ourselves. The British Chamber of commerces network have put ward basels that say proposals that say get cash for bonds or some other means of borrowing. Preferably private are a wink but it could be publicsector spending, would be beneficial for the economy. We need great infrastructure to drive the economy, but to facilitate businesses and exports. So road rails, seaport airports, Digital Infrastructure and having to write source of environment for longterm Energy Security is hugely important. Investy borrowing to could be a perfectly legitimate thing to do. We dont have a Multiplier Effect on the economy. Would it be best done by the government borrowing money in the regular way, or do you like the idea of this. Were people talk about using the bank of england to do this . Guest we have come to the conclusion that it would be quite inflationary and would be a bad policy at this point. It is not completely bonkers. Reasonable economist in 2008 suggested helicopter money. It is not outside economic theory. In the depths of the recession or a future recession that peoples qe might be the answer. But we think it is better to have a special category of guilds and a special infrastructure of banks through which that can flow. Anna i was talking to Peter Mandelson and he was talking about how Jeremy Corbyn has backed the idea of staying within the european union. That goes against perhaps the early noises that Jeremy Corbyn had made. How do you feel about the subject of europe and staying in . And what we hear from the labour party . Said and willave continue to do so right up until the referendum. ,he position at the moment is if Senior Business people say that if they were to vote on the eu tomorrow, the majority would vote to say in that they have big concerns. They want reforms and they say it is literally half and half who say it would be a disbenefit to the european union. It is literally split down the businesses certainly believe that they may change their mind. Half of our Business Community say they would change their mind depending on what the Prime Minister reduces. Anna thank you very much for joining us. Be covering Jeremy Corbyns speech a little bit later on. But i will be back with some clips of that conversation that Peter Mandelson had last night. Thank you very much indeed. Anna will be back as well and we will be talking tax. We are going to be talking to the tax research economist, richard murphy. Theyuch exactly could raise from changing the tax situation here in the u. K. Would that solve the Debt Financing programs problems. , the woes about the w continue. German prosecutors have launched a criminal probe. Havelabor leaders expressed some concerns that he remains very much at the top of the vw structure. Lets go to a hans nichols. What exactly are they doing still . Rn still hasnterco the Top Executive spot at audi and the Porsche Holding company. That controls 52 of volkswagen shares and the fact that he is still around, it may make clean up a little bit more difficult for matias muller. Two point 5 million vehicles were expected and moments ago we learned from a spanish paper that there could potentially be issues in spain and from the prosecutor yesterday, they made it clear that they would follow this case wherever it went. The focus of the investigation will be on the suspicion of fraud. In the framework of this examination it should be clarified which persons are responsible for these allegations. Hans germany has amended a solution by october 7. In the meantime we have some developments. Namely what will happen with dr. Venter corns severance. Remember that he had about 28 Million Euros in his pension account. But according to persons familiar with the matter some members of the board on the union side are not comfortable with giving a big payout to dr. Venter corn. Another nugget that we have unearthed here is on friday at that big long meeting, at that point they saw and reviewed documents that indicated that volkswagen executives knew four years ago potentially that there was a problem with this device. At that point, no one took action and i suspect a lot of the focus of this criminal inquiry will be on who knew what and when and what those documents laid out. Guy thank you very much, indeed. Hans nichols on the latest were getting surrounding vw. We will be back with a story that is not going away. Other stories that are not going away is the central bank story front and center. Withed front and center the carl icahn video that has been released. Iran four minutes time we will get a medium rate cut. We have german cpi coming up later and we have tesla news as well. An all electric suv. eeeeohmumohweh hush my darling. dont fear my darling. the lion sleeps tonight. hush my darling. man snoring dont fear my darling. the lion sleeps tonight. woman snoring take the roar out of snore. Yet another innovation only at a sleep number store. News out at 6 30 in london. A significant move from the indian central bank. Bigger than we thought. Caroline hyde has the details. Caroline not one economist forecast this. A 50 basis point cut. 7. 5 ing the rate down from from 7. 25 to 6. 75 . Felt we would see a rate cut of one quarter percent and instead we got half a percent. It is currently still weaker by 0. 25 . Interesting that we are seeing some strengthening on the back of that but really only one economist foreseeing this on the back of that. We are seeing the rupee strengthening slightly versus the dollar. As i say, 37 out of 45 economist that we surveyed believe there will be a quarter percent cut. We have seen some pressure on the r. B. I. Overall about trying to lift the economy in india by reducing rates and making it slightly more appetizing. We have seen inflation on a downward trajectory and the cpi east to 3. 66 in august and the target is 6 at the moment. So they are below target in terms of inflation for the 12th straight month. Really, the head of the reserve bank of india has felt that this is because of oil at the moment having an overwhelming effect. The fact that actually the itget is closer to 5. 5 . Would seem at the moment that he is responding to pressure for the economy to be given some resuscitation. the overall Interest Rates. They are being cut more than had been forecast and we will see how that bears out on the semtex which had been trading lower ahead of this decision. Guy it is probably worth pointing out that you did see a fairly big jump in the dollar versus the rupee let me show you the threeday chart. As you can see, a fairly significant drop is what we are looking at at the moment. But you have to put that into the context of what we are seeing. 50 basis points. Let me talk to you about the other stories that you need to know about. The asiapacific index heading for its biggest quarterly loss since the Global Financial crisis. Every major benchmark in the region treating today. Companies really. Aking it pretty hard in asia and australia in particular. Highlighting the threat of more material prices. Trading down hard overnight on the hong kong trade as well. And nasa as we learned yesterday detecting liquid water on mars. The water does not last long on the surface. It even rates quickly and the atmosphere whips it up and away. The timing could not be better for those who have a film out about mars right now. World leaders very much remain divided on how to end the carnage in syria with obama using a speech at the you when General Assembly to suggest that the a change in leadership is necessary to move this country forward. Lasting stability can only take hold when the people forge an agreement to live together peacefully. Prepared totates is work with any nation including russia and iran to resolve the conflict. We must recognize that there cannot be after so much bloodshed and so much carnage, a return to the prewar status quo. Mentioningent Obama Vladimir putin and he used his own speech to show support for the syrian leadership. Russia has always been fighting against terrorism in all of its forms. We provide military and Technical Assistance to iraq and syria and other countries fighting terrorist groups. We think it is a serious mistake to refuse to cooperate with the Syrian Government and its armed forces valiantly fighting terrorism facetoface. We should know is nobody but a sods forces are truly fighting the Islamic State and terrorist organizations in syria. And meeting between the u. S. And russian president s, the first since the year ended without significant breakthrough. Ryan chilcote joins us now in the studio and he has been monitoring the story. Any sign we are seeing something here progress. Happy toguys are not see what another. You wonder when you have meetings like this whether they are told not to smile at president obama, very careful not to crack a smile at any point. When they show cancer they did not even look at one another. Trust that both feel for one another. You see president putin smiling but president obama not smiling at all. That really tells you the story. There are two bones of contention that remain after these guys sat down for 90 minutes yesterday. The first is what to do with a sod. The u. S. And ministration, president obama thinks he must go. Ultimately he must go. And president obamas speech in the lead up to his meeting with president clinton he did mention that he recognized the could be some kind of managed transition to a more inclusive government. But the Sticking Point is that president putin seems to be pushing that a sod should stay even after the dust settles. Isfar as president obama concerned, that is a nonstarter. Too many people have been killed. The other bone of contention is that as the russians take the terry action as they are threatening to they have fixed wing aircraft and helicopters and a pcs but they want to engage in airstrikes and they will start whether the u. S. Is on board are not just as soon as they get a request from the assad government. The bone of contention is who do they hit. As far as Vladimir Putin is concerned anybody fighting a sod with the exception of the kurds is a terrorist. So Islamic State is much more broadly defined by president putin than the u. S. And ministration. They are happy, maybe slightly uncomfortable, they are happy for him to strike the Islamic State. But they dont want him to strike with fixed wing aircraft at any other militant that might be perceived by the u. S. And ministration as more moderate opposition to a sod. That is the big issue there. Sat down for 90 minutes and ensure it was a detailed conversation. Guy the foreign minister from russia talking about the fact that the u. S. Coalition may coordinate. That attacks might must be correlated. Interesting to see how this develops. Ryan chilcote talking about how the story surrounds obama and Vladimir Putin. Maybe some progress but i think it will take a few days. Lets move on and talk about another leader. Italys Prime Minister is weighing in on the relationship between russia and everyone else. Countrya is a great with a great history the great future. Imagine a future without russia is a mistake and i think we can rules russia to respect in the ukraine. In rules in the ukraine are the protocol of minsk. Everyone must respect the protocol of minsk. Else, refugees apart, russia is absolutely crucial. Italian primee minister talking to bloomberg yesterday. Lets look at our guest host for the next hour. Indians, cutting by 50 basis points. A surprise, we were expecting 25. The cheap money story continues in all corners of the world. Is that a good thing . I think it is a necessary thing. Well anddoing pretty their expecting indian Interest Rates to fall as inflation falls. Guy how do you see Global Growth at the moment go there are a lot of concerns about showing a different slowdown and maybe this is a reaction to it. Downthink it is slowing much quicker than politicians and banks and commentators are seeing. China was fantastic on the way up and it is much more difficult to manage the economy on the way down. Chinese growth is nowhere near the 7 that people were expecting and building into their projections of the World Economy. We have to do more to fix the economy and have a real debate about what we need to do to fix them. Guy what is your answer to that . Invest. The u. K. Is a great place to invest and we are under investing in every aspect of the economy. The physical constraint infrastructure and the intellectual infrastructure. Guy how should we finance that . That is what we had just talked about. The world is awash with money and it wants to find a safe home. Weve had a lot of fast money flowing around the world. This huge amount of institutional money. We have to attract a disproportionate amount of that money here to the u. K. To help us accelerate the growth of the u. K. To create more real jobs for real people. Guy it is easy to get money into london. What is stopping that money getting elsewhere . It is changing elsewhere and there is a sea change going on across the u. K. Great success in creating a more vibrant economy here in london. We have invested a lot in manchester and there are lots of energized politicians and Business People that we are seeing the same and leads, cardiff, bristol and newcastle. People want to invest and local economies. We structure their local economies and rebuild the cities that we used to have in the u. K. Guy we should issue get to do that . Issue debt to do that . I am not a big fan of the shortterm debt model. We need more equity. More longterm institution money that is there for 50 years. Longerterm capital rather than shortterm debt finance. Guy what do you make of peoples qa . Qe . I am not a big fan of peoples qa qe. As i wonder across the u. K. There are a large cover of startups. We are the World Leaders and startups. We have to become the World Leaders and growing instances which involves investing in the Smaller Companies which exist everywhere i go. Two andk in a year or see that they have hardly moved on. They are still small companies. The u. S. As a model that we can copy or they have created huge and successful businesses, particularly in california. We need more of that in the u. K. A bit of a fans of debt but we will square that one. Nigel wilson will stay with us for the next hour. Plenty to talk about. As we have just been discussing the india centralbank cutting rates by 50 basis points this morning. There was a press conference which is starting about now. We will get more details from. This is how the rupee has been reacting. As you can see, we did see an initial strengthening. Thats beginning to run out of steam at the moment. But governor russia maybe trying maybe governor raja trying to add a little steam into the economy. Guy let me tell you about the stories you need to know about. Bank has lowered Interest Rates more than expected. They cut the purchase rate 50 basis points. The move was predicted by just one of the 52 economists and a bloomberg survey. Asian stocks have been tumbling toward a threeyear low. Headedapacific index for its biggest quarterly loss since the Global Financial crisis. The yen are holding on again. Rising volatility still in demand. Asias biggest commoditys company tumbling. Glencore tumbling 30 and yesterdays trading. Down by a record in hong kong. Fiorenzi says spoke to bloomberg in an exclusive interview. We could have some problems for china yes, maybe. If you think about export, just export was example, in the provision of italian statistics. 3. 7 this year. In the first month we earned more than 6 . I think it will not be a problem for exports. Guy george osborne, the u. K. Chancellor thinks china is the opposite of the u. K. s economic woes. That was a view shared in the labour party conference. Anna edwards is down there. Jeremy corbyn giving his address later today. He has been fairly diplomatic some would say over the last day or so. Anna speaking to some of the party faithful. Anna specifically last night we were talking about europe. The policy network and the city of London Corporation hosted a debate about the u. K. s future in europe. Lord Peter Mandelson was on that panel and he started by linking the conversation to the very Holding Together of the united kingdom. As important in terms of the magnitude of the conversation about europe. Andescribes himself as instinctive european performer. I wanted to get an idea from him about how united the party is on this message around europe. Is the leader on board . He seems to have made some positive comments about europe as of late. Peter mandelson talks about what he sees as a return to the left leaning policies of the 1970s. Then he gave these more positive remarks. I suppose that when jeremy was elected, i thought, it is coming back. But it hasnt. It hasnt. On this, at least he has been refreshingly clear. Position timehis and again that the labour party under his leadership will not, under any circumstances, campaign for britains exit from the european union. Anna we got some positive samplings from the Business Community. We had john quinlan from the cbi and he was talking about how we have to show people that the benefits of outweigh the costs. Eventosley hosting the talked about how some of the changes he has seen as of late have been positive. He likes the way that certain things have been taken off the table and appreciates the changes made there. Mp had a warning for business about the best way for business to get involved. If were going to win this debate, it has to be a grassroots campaign. Ceosll not be won by the of the companies which make up the mentorship of the cbi. Writing in the Financial Times telling people from on high what they need to do when the referendum comes. If you want to take those companies as an example, the people best situated to make the arguments will be the people who give them their payslips who can explain what brexit will mean for that workspace. Anna Jeremy Corbyn will be center stage later on today. Just after 2 00 he will be speaking to delicates. Yesterday was a real exercise in avoiding conflict. We are going to hear, in terms of specific policies about how this party if it were to be in power would not take some of the Energy Companies back to national ownership. From Jeremy Corbyn himself will hear about the importance of not imposing his view from the top. He will talk about a Caring Society and a kind of politics that he wants to bring to the table. He will be stressing his pride in his country. Important if you have been following any of the conversation about whether or not he should have been saying the National Anthem at those world war ii commemorative ceremonies we saw just after he was elected. There is more building bridges between the Business Community, the Financial Community and this labour party finding its feet. To all ofng forward that coming out of brighton later on. It has been a busy morning already. Still plenty to come. What we have had is an indian rate cut, 50 basis points. A little bit of a surprise. Only one of the economists that we polled predicted that. Carl icahn making headlines overnight. Here he is talking about corporate earnings and the problems they are generating. Companies today, and set of taking the money they can borrow and investing and a lot of capital, new machinery and new equipment and and workers to make them productive, what they do is almost perverse. They just buy another company to show the analysts on wall street that the earnings are going up so the stock will go up. It is Financial Engineering at its height. Wilson is still with us. Kind of members what you have been saying. I feel privileged that we have a similar view on this. We see too many share buybacks across the world. Too many unnecessary mergers and acquisitions. People are really trying to drive the growth of their existing business by getting equity off of Companies Like ours to invest in longterm growth. There is lots of Great Technology around, but we are under investing. The Public Sector is under investing. Guy one of the other things that carl said overnight is he feels that low rates are blowing bubbles in certain asset classes. Is that a fear that you have as well . Are you talking about putting the money to work productively. There are areas where this money is aggregating and pooling. Like you earn a lot of assets, what do you see . There have been bubbles and there will continue to be bubbles. They have been driven by a huge amount of liquidity around the world. It has been withdrawn from certain markets. Can see rices gets prices continuing to fall. We to invest into longterm, sustainable growth. There are too few companies around the world investing to create longterm growth. That will change going forward. Aboute were just talking assets that had fallen. Glencore, a lot on the website about this. Amazing amount of coverage, more than we could possibly cover this morning. The story, the wipeout has continued in asia. You mentioned the glencore stock in hong kong but all the other Commodity Traders down 15 . Mitsui of japan. All big competitors suffering contagion. Guy what would your advice be to eiji . He is probably the most notable person i have met on the commodity markets. My advice to ivan would be to talk about his strategy. To get rid of the gossip and the noise in the market. To get a better signal. If anybody can solve the problems that glencore, it is ivan. He is one of the most competitive, intent individuals you will ever meet. Guy we will see you in a moment. eeeeohmumohweh hush my darling. dont fear my darling. the lion sleeps tonight. hush my darling. man snoring dont fear my darling. the lion sleeps tonight. woman snoring take the roar out of snore. Yet another innovation only at a sleep number store. Kong. Shares drop more than 25 in asian trading tracking yesterdays move in europe. Asian stocks tumbling toward their lowest close in three years. Bank cuts rates by 50 basis points. Only one economist predicted a 50 basis point cut. Welcome to countdown. We started things across the table. An indication early on of how we think. European futures are likely to open. Let me give you an early look at what we think the fair value calculations are. We could see at this stage another percent coming off european equities. You have the euro stocks down by. 9 of 1 . The fair value calculation cac down by a full percent. It looks like we are seeing more theing pressure coming into european space. One factor behind that could be a video that is out from kyle carl icahn. Here he is talking about the low rate environment. Karl why should they raise ates and its almost like rhetorical question. So many reasons they should raise rates because low rates, its like building bubbles. Building real estate bubbles, building bubbles in the art market. Is financing that he is backing donald trump from his economic point of view. The other stocks story were watching is what is happening with glencore. I like. The one that it is called debt and equity. This is the green glencores yellow is equity. This is the problem down here. That is the debt problem and that is what needs to be sold at the moment. Are we going to see more issuance coming out of this company . Would be great to hear from nigel wilson. He should make his the mix overnight in the asian trading story. We have more details. That was in europe and in the u. S. And here in hong kong as you mentioned. Glencore shares dropping to a record low weighing on the overall region. We have seen the hang seng index down 3. 4 . If you have a look inside you can see that stocks are in the black. That fallout from glencore weighing on other commodity players as well. Also want to show you the nikkei to 25. This is japans index of the top 25 listed stocks. They closed tire today and we saw a big selling coming through in those commodity players. Can one stock have such an impact on the Global Equity market . It is that concern about a slowdown in china, about a slowdown in Commodity Prices and those plunging prices we saw on monday. D copper one of the worst performers or the worst performer in the nikkei to 25, down more than 11 . Other mining players coming under pressure as well. He asx 200 closing at 3. 37 we saw the mining players, take losers. You mentioned that rate cut in india. There was a big and a bit of a pickup. It has gone back into the red at the moment but that surprise interestrate cut to 6. 75 from the reserve bank of india. Some analysts are saying it is under bought but urls everywhere else selling. Guy a difficult overnight session in asia. Stock reverberating across the region. Theas shares in some of australian bigger minors. Miners. How hard has it been . Been a bleak gain trading in australia. Bhp billiton, the worlds biggest mining company, that touched and almost sevenyear low during trading today. Rio tinto, the secondbiggest minor touch to the lowest since the middle of 2009. We have seen the likes of fortis escue. Ort both in the red. Losers, thehe zircon that goes into floor tiles and those apartment blocks in china. It has been a very bleak day for the miners and investors are saying they have to weigh the prospects for some of these companies now. And that is the concern as well. It has added up to a pretty bleak day for the Mining Sector here. Update. Nk you for the joining us out of melbourne. A quick headset on the relationship we have. Peter grower who is the chair of an executive, is director at glencore. We will have plenty more on the glencore story as we build up trade here in europe. We will talk to paul gates. He has done and outperform rating on the stock. Why did he feel that was necessary at this stage . We will take a look at the big losers in the stock pledge plunge. Big influence in switzerland. The stock down to a note out to investors. Wilson is here. As our guest host. The mining business is kind of what you have been talking about, investing for the longterm. Yet we see huge amounts of volatility. It is very hard to gauge, understand, plan for what happens with the Global Economy which increasingly feels short cycle. Youre saying we need to invest in the long term. How do we manage the kind of duration mismatch that sometimes occurs as a result . How do you look through that . Thing we have called wrong is the slowdown of the chinese economy. Most people thought it would go at grow at 7 per annum. It is not. The biggest impact was on commodities and that has been of timefor long periods so we have been waiting for commodities to get hit. They have been hit very hard right now largely because of the chinese effect and the spin over and the contagion that exists not just in the physical markets but increasingly in the derivative markets which surround all these equity and debt instruments in all of these firms. How hard they are focusing on dark pools being one of the big areas. When you try and move stuff around, how difficult is it . Nigel one of the failures of centralbank policy and regulation has been the reduction in liquidity. That Market Makers have as a consequence. Too many of the markets are too thin. It is difficult to trade. Were getting increasing allah tilney which is making the impact much greater than it would have been. The banks used to hold a buffer. They no longer hold that anymore. There is ank mismatch between what the markets are signaling and the economic reality . You spoke about we in the media and some of the markets are underestimating the rate slowdown. How do you put those two together . Nigel i think the World Economy is slowing down faster and we saw that this morning. That was bigger than expected. What are the consequences of that . There is a huge amount of uncertainty around those consequences which is creating a huge amount of volatility and a large amount of money flying around. It is exiting difficult situations because the signaltonoise ratio is very difficult for people to interpret. Those companies that are in Financial Difficulties are having difficulties communicating their narrative to the market. Chiefd like the executives to be on the front foot, sort of a pr strategy. To committed to the wider market what is their view of what is going on, what are the actions are they going to take to rectify the problems they are currently having . Guy you mentioned india. Nigel is staying with us. India cutting rates by 50 basis points. The governor taking their rates to 6. 75 from 7. 25. We pulled a lot of economists, 52 of them. Only one suggested that we would see a 50 basis point cut. Anding by with details. Why such a big cut, why this 50 basis points . That caught the markets by surprise. 51 economists we surveyed cut. Ted there was not is reflecting the global concerns. He has decided to bite the bullet and take that 50 point basis cut. Is a commentary on inflation. Inflation has the biggest that the governor has been working with. Rope walk. A tight beennflation forecast has cut to five point 8 . It is at 6 . Expectation for growth has been revised downward. This is when the one of the key reasons that is being watched. Will be aecting there pickup in growth for the next fiscal at about 8 . The focus really is going to be on whattion, perhaps the fed will do and how the governor is going to react to that. As far as inflation goes, that makes up 50 of the Consumer Price inflation basket. We have had [inaudible] the biggest concern has been on how we will react to that. Said, it has been a big surprise. We saw the markets that opened in india. Racking to that commentary coming in from the reserve bank of india. Trading into positive territorys. That comprises all your largest banks. Now managing to cool off [indiscernible] surprise. Big back to you. Guy thank you for the update. Nigel wilson still with us. And wentioning the fed have not talked about the fed yet. Was it a mistake to raise Interest Rates . Nigel yes. There is an obsession by the markets to watch the fed. The fed has got an obsession with watching the markets. We have to get the balance right and stop focusing on what is going to make economies grow again. That is really about investment. As carl icahn was talking about earlier on. The world is too fragile for risks to be increased. Guy he thinks they should raise rates because they are blowing asset doubles. Distortions. Are distortions are unwinding as we look at the screen right in front of us. Looking forward, the asset doubles are not unwinding themselves. That includes equities. The equity prices always looked relatively chief cheap compared to bond pricing. As a standalone asset class. I agree is the fundamental or denying Growth Companies is not good enough to sustain the equity levels. They have to get back to basics themselves and come up with strategies which allow them to deliver longterm growth for their shareholders. Guy is everything overvalued . All boats have been floated. Maybe to different degrees. Nigel that was true. That was about qe. It save the world but we did not develop another strategy. We seem to be heading to qe4 rather than an alternative way to get people to invest more. Particularly in equity. We have 200 trillion of debt floating around the world which is causing a lot of these bubbles. We need to get much more equity in the economies and get lots of Smaller Companies growing and equities growing, not debt. Guy youre going to stay with us. D our guest has an outperform rating on the stock. Record losses today. Stay tuned. Where back after this short break. We are back after this short break. Guy it is 7 18 a. M. In london. And deaths Indias Central Bank has lowered rates. Such a move was predicted by only one economists in a bloomberg survey. Asian stocks have tumbled to war toward the near threeyear low. Heading for the guest loss since the financial crisis. Every major benchmark is retreating today. Safe havens are in demand. The end is one of those at the moment. This is after the crash and when core stock. 30 yesterday. Lets get more on the glencore story. Our guest has an outperform rating on the stock. Analysts, just three say it is a self a sell. Good morning to you. We have been talking about this chart over the last couple of hours which is glencores best and equity. Your view is that the yellow column is in the wrong place. Worthom is not what with the market is suggesting. We have often discussed this. The market is reflecting at the moment is not even the spot Commodity Prices. , ais discounting continual perpetual continuation of suppressed margin generation from glencore. And essentially zero value in the trading business. Most of both of those are unrealistic. We had a number of notes coming out over recent days. In the absence of any news from the company, we are stoking the fe around the stock. What we have seen is not even on the value of its industrial business but falling way evrom that. When i look at that and someone said is the Company Worth 14 billion, no. I seem far more value than that. Even if i keep the spot commodity price deck kind of constant. Has an Interest Payment of 1 million d somewhat between 2 billion in 2 billion that it needs to spend. That gives you a billion and 2 billion to equity. Even assuming the recovery, even assuming no ability. Fir questionthe people ask you . Is the equity wth anything at all. And then we get to essentially a self of filling dete area why shouldhe equity be worth something . Theye question whether will be able to refinance. That becomes a seat a deeply ciular argument. How muchworth nothing is thequity worth . That is not answering the estion but begging the question. So again you look at that area due you look at that. Multiyearistoric lows iterms of not just glencore buthe entire industry and its ability to generate cash. E in perpetuity ever again. Is that the world we want to reflect, is that our base Case Assumption for where commodities are heading . Certainly not mine. 75 of the worlds industrial capacity, that is 75 of stainless steel coming out. 75 of the autos, 75 of industrial capacity which is predicated on the existence of the outflow of metal. That is not a base case scenario. Factyou talked about the that we are seeing an unwinding of asset doubles bubbles. You have talked about the fact that Global Growth is slowing down. Do you have a sense that we are swinging too far . The most compelling argument would be given by ivan. Talking to my colleagues about it yesterday, this is a similar confusion. There is lots of competing. There is a lot of noise, not enough signal. Lack of signal creates lack of information. It is causing a huge amount of uncertainty which is having a massive contagion effect across the world. It is close a laymans moments. Lehman did go bust. Everyone got all their money back. Even despite all the feeds and everything else. It should not have been allowed to get into that amount of financial distress and should not have been allowed to go bust and did not react fast enough. My courage meant to ivan encouragement is talk to the endless, talk to media, talk to everyone about what is the profit positive future of glencore. Value should lay out the proposition and make it clear what the trading is an as is. Ever since people moved camels down the silk road there have been traders of commodity. Someone had to stand behind the financing of it. It is a fundamental business. Make that case. Point out that the court has to move from a to b. He coal has to go from places economic viable and activity. What we have got is Maximum Capacity around the state of the chinese economy. For all these economies. We have the fog surrounding the macro position, is China Growing 7 . The clearly not. What will the demand for we have as be . Confusion around the line of leverage that there is on the industrial asset and the trading business and what the economic function of that trading business is. What we need to do them a what glencore needs to do is get in front of these more outrageous claims and rebut some of the analyses. Get ahead of that and take some of the risk out of the investment. In certain instances you could argue that would be a better business. They are very underrated. Some of the finest companies have the longest term view. Ofs very longterm view helping to develop the business and there was a great deal of Financial Stability for companies. You will you are too exposed. They operate on even greater leverage than glencore and generate lower margins. If we are saying that liquidity has glencore has liquidity [indiscernible] and then what world are we painting here . We are saying that that is going to take place. You can see this on your chart. Guy do think you should take the private Company Private again . , the market iss a true reading zero. If you have that kind of situation i am sure someone would see the value in it and be thinking about it. Guy we will leave it there. Thank you. Guy these are the stories you need to know this morning. And he is a central bank has lowered Interest Rates more than expected. One economist out of the 52 we surveyed expected that. Asias against Commodity Companies have been tumbling overnight. Funds nearly 30 backed by a record in hong kong this morning. Chinas slowdown hurts the outlook but they can continue to grow the export. Have year we can could have some problems for china. Yes, maybe. Our export is good but when you think about export you have to think about import. Export was in the provision of italian [inaudible] plus 3. 7 this year. And in the first month we were up. I think it would be not a problem. To bloomberg in an exclusive interview. European stocks are lower. Lets find out what has been happening overnight in asia. Standing by in hong kong with the latest. Juliette this is the picture here in asia in the late trade. We have a number of the k markets closed create australia and japan have finished area disclosing at its lowest level since january and australia at its lowest level in two years. Can see here on the regional benchmark index which is on track to close at near threeyear lows, we have red across the board. Are seeing basic materials under the most pressure. Even defense of Health Care Stocks got a meeting today. Down by 4. 5 . Heres the picture on the overall region. We can see big falls coming through. The hang seng index down 3. 5 in late trade. Glencore shares tumbling on the back of that big selloff that we witnessed in london and new york trade when they opened in hong kong. They sell 27 to a look a record low. We have half an hour straight left to do in the and the shanghai composite is down. Heres the big weakness i was tensioning. Japan closing 4 . This shows the story. Stocks on the nikkei to 25 closed higher. Bhp billiton at falling the most in six years. A number of the key mining players, down 13 . All sold off on this glencore story. Concerns about china and the route we are seeing in Commodity Prices playing into the region. The indian market down by. 4 of 1 . It got a spike on the battle backsurprise rate cut of that surprise rate cut. Not a great day for trade here in asia. Thank you. On the closing a couple minutes of what is happening out in asia. We are half an hour away. Markets open. Let me give you a sense of where we think that opening is likely to take us. This is the fair value calculation. I will get the director to move in here. Its not looking great right now. Rostoxx down. Eu cash leel key level. Off. Ax is 1. 7 the back of what has been happening with glencore. Perhaps most keenly felt by the companys ceo. The billionaire lost 500 million yesterday, seeing his network net worth shrinking. Onlightly different take these troubles, we are joined by devon pendleton. Are us through, there obvious reasons why this is bad. Fell he lost more than a quarter of his wealth in one day. That is an exclusion ex clamation point. The 190thjuly he was richest person in the world. He is worth 7. 3 billion. Today he is worth 1. 4 billion. A pretty steep drop. Guy if you were selling luxury goods, how nervous would you be . I would be extremely nervous. It is not just glasenberg. He is the guy with the most skin in the game. When glencore went public it was like a factory for billionaires. It made it made at least five of its executives billionaires create and many other traders and investors became billionaires as well. They are very nervous and i can guarantee you they will not be dropping off those stores anytime soon. Lets bring in our next guest who has a pretty positive outlook on european equities. To hold that stands right now . We have seen european equities perform very well for a number of years on the back of not that much of earnings growth. Earnings ratios are higher which they don that markets, have further to drop when headlines come out. What is important to remember is European Companies have been struggling with not too much growth from domestic markets for a time. We have some positive data in europe. Guy that should drop down fairly quickly. A lot of them went through a tough time in 2008, 2009. They strengthen their balance sheet. These companies are in good shape. There are cash is a lot of focus and commodities. There are lots of sectors doing really great things, for example, the pharmaceutical sector. Guy biotech is having a great time in the states but that is a different conversation. Cahn has talked about the fact that there is so much Financial Engineering. These companies are operationally geared. Pnls are in the right place so you get that dropped through the bottom line. How much equity distortion has there been as a result of this emphasis that there has been on buybacks and the engineering surrounding the financing . Has beenthink the some. That is a factor. I do not think that detracts from the fact that these companies are in a very strong position. I dont think that we will have materials [indiscernible] going forward, to be honest area guy if you were putting fresh money into the market, it is tough trade you are looking at where the leadership will come from. Where do you think the leadership will come from . Guest you have to search really hard for opportunities. There are lots of companies that have been hit indiscriminately. For example, you might have an Engineering Company that serves the mining industry. Clearly very tough, share prices have fallen a lot. It might get a lot of their hitnues and from serving servicing equipment. They are still making decent earnings. These companies will survive. I am not saying it is possible. We have some choppy times ahead. I think the next year [indiscernible] guy you talk about the fact that the baby gets thrown out with the bathwater. You look at correlations. Back to risk on, risk off but that feels a little bit like it at the moment. Which makes stockpicking harder. Guest i would not say stockpicking is easy but there is a lot more opportunities. It has been getting quite tricky in europe earlier this year when we saw the lofty valuations. Now that we have seen our kids come back youre saying more opportunities. Is there issic view money flowing around the world in spite of increasing aggregation of assets into that style of investing. , there is it is opportunity out there. Some people say that becomes harder and harder. More professionals are investing, they are try to make more and it becomes difficult. When you look at how the future of how you will be investing works, is that going to be the case . Markets are not 100 efficient. I dont think that is going to happen anytime soon. Areworlds markets inefficient, there will always be opportunities. Guy thank you. 1. 7 at European Equity markets with 20 minutes away from the open. This is how the picture looks at the moment. Pretty negative. It has been a negative legacy. You have this video which is not helping the tuition. We will take a break and see you in a moment. Guy 12 minutes away from the market open. Here are the stories you need to know this morning. Indias central bank has lowered rates from 6. 75 from 7. 25. 50 basis points. Was predicted by one of 52 economists that bloomberg surveyed in advance of this announcement. And every major benchmark in the region retreating. People are looking for safe havens. Seems to be that at the moment. Commodity companies have an tumbling. 30 . Ore plunged imagine what is happening with the indian story. 50 basis point cut coming through from the governor. Most people were expecting 25 basis points. A quick headsup on what that has done. This is the dollar versus the repeat rupee. You would have thought in some ways that you get the opposite reaction. About theor talking inflation concerns surrounding the monsoon. That has been the reaction following the basis 50 basis point cut. Caroline hyde is here with some of the stocks we need to be looking at. Caroline i want to focus on the stoxx 600. Where close to a bear market on the benchmark here in europe. We are down 17. 5 from highs that we reached back in april of this year. Now if we see another selloff like we did yesterday we will be on the cusp of what is a bear market. Between percent below those previous highs of the year. But could drag it lower . Miners. They were down 7 in europe. Will we see glencore, the rout continuing. Phenomenal slump in the glencore stock. We saw that merit in asian trading. Record lows. When we see it down in european trade as well. Inrently down more than 3 4 the last 12 months. Most of itsng market valuation. At one point it was 85 billion worth. Now some 10 billion worth. And nominal value eradication from glencore. Take a look at volkswagen. The scandal continues. Already trading lower in premarket trading. It sells off a little more by the tune of 2 . Headlines hitting the tape. More orders falling in september. The nikkei is seeing slowing sales in japan. Canceling sales of their cars in spain. That is and the provisions do not include the legal fees that have also been reported by the press this morning. Once again, volkswagen in focus nestle. Estingly is being along with mars and hershey. This is a case being brought in north california. Three classaction lawsuit saying the company cast a blind eye to known human rights abuses particularly regarding suppose labor alleged child slave and the shirking of responsibilities. That is one to keep an eye on. And on a high note. Because first half sales were strong. A rereading to see of this stock rerating of this stock. Have 3. 5 million customers. It is an Online Fashion retailer. It could increase on the start of trade. Once again it is a down day in europe. Guy thank you. As we work our way toward the market open. Sometimes we need to take a step back and look at what is happening in terms of the overall tomography of the markets and how they function. The european securities and markets authority has taken a of step in its overhaul market policy. The regulator updated rose to the second markets in Financial Instruments directly. We know that [inaudible] which will reshape almost all aspects of european financial markets. Moves andwing the making sense of the new rules for us. Which are expensive to say the least area the least. You focused on specific areas. Which areas have you been focusing on and what changes are we likely to see . John we got hundreds of pages and we sort of fanned out. I cover Market Structure so i looked at the proposals for dark. And Market Making. Guy these are huge functions. Obviously a big heart of the market at the moment. The Market Making critical considering the kind of the quiddity issues we are saying. What are the applications . Trading will be capped. The size of the trade will be capped. The amount of the stock that can be traded in the dark will be capped. A percent europewide. It goes over that threshold that can no longer be traded in the dark. What we got yesterday, we got a proposal that basically it is unchanged. There was perhaps some hope for the most liquid stocks that a loophole is not the right word but there is a waiver. And that is the key. You can trade larger chunks in the dark, unlimited in most cases. Perhaps there was a hope that maybe that threshold would be so they could stay in the dark. They are basically and changed. What does this mean for market liquidity . At ftse 100g stocks, although stocks would break through, crash through the threshold. They would not be able to be traded in the dark. Half of the ftse 250. As things were traded in 2014, you look at that as a proxy, it may be difficult to trade large. Guy maybe more visibility for the markets. John that is what the regulators want. Guy one thing we were looking for is a change in research. Buy and sell side being impacted by this. We did not get that. John my understanding is that comes from the commission. We did a story recently on that topic. Most people are critical of this. A lot of people say they do not like what the repercussions could be. We did talk to an asset manager, Pioneer Investment quite up and saying we like this. We want to see a split. Plan andady have a csa sharing agreements which is the way to work with the stuff. They like it. Lots of other people say it is not going to be there for research especially for Smaller Companies. If some more power ofe in the hands [indiscernible] asset brokers. John there is a concern that it could make it more difficult for smaller Market Makers. These will not make the barriers to entry higher. Hft firm, is a small it could be harder for them to adhere to these regulations. Guy what is the sense in the market of these rules, these technical roles and the response to them . John part of the feedback is a tooof these rules are rolesbased. This is very prescriptive. When you reach a certain certain trading threshold, it is quite detailed. There is a sense that this will be difficult to work in practice because of you have these thresholds whether it is for liquidity or fixed income or equities, it is hard to dial in this data so perfectly. Be broader and perhaps more flexible. That is some of the feedback i have gotten. These come into force in 2017. Guy which sounds like a longterm away but it is not a long time away but it is not. John the way they are measuring the threshold, it is 12 months of data starting in 2016. Guy thank you for your analysis. Hear a lot more about this. We will see this being enacted fairly quickly. Lets get back to the minute by minute stuff. Equity markets will open down pretty hard. Jon ferro will have the job of watching this. Every single headline out there is doom and gloom. Andn stocks are tumbling Japanese Equities down 4 on the session. You look anywhere, maybe want to look at glencore. Maybe that embodies the stock story. Carl icahn warning of danger ahead. And warning of a weakening Global Economy. We know the 12 month story. A weaker china, a commodity rout, a company burdened with too much debt. Intraday move was quite remarkable. A tumble of 30 on nothing. No real news. Oneking a 30 rout on single stock. Maybe there was a negative Research Note out there. I will speak to the analyst of that note. Bernstein who were looking for four pounds 50. Invest i spoke to ech. Does anyone know how to value glencore . We will answer that after the break. Guy looking forward to the show coming up very shortly. Mentioning that negative feeling we have at the moment very much reflected in european equities. 1. 5 on the euro stocks. Cac down by 1. 4. Dax also down by 1. 4. Key levels to watch out for today. Jonathan good morning and welcome to on the move. We are moments away from the start of european trading lets get straight to your morning brief. Global stock selloff. Glencore drops by a record in hong kong. Asian stocks stumbled toward a threeyear low. The rbi cuts the benchmark rate. The Global Economy is weakening into danger ahead. Billionaire Hedge Fund Manager icahn warns that the fed is creating bubbles is there anything new in the video . All i know is that there is so much doom and gloom in the headlines this morning. 15 seconds away, ftse futures rout inx down, a stock asia. Lets get straight to caroline hyde. We are very much back and so close to a bear market on the stoxx 600. The benchmarks in europe are but fall fromghty 20 april. We are starting to accelerate the losses across the board. We will hear from the bank of the reserve bank of india. Economist for saw a percentage point cut to rates in india. Seeing the negative sentiment inequities, and we are seeing a movement and the heathen. Is the euro ag